A growing number of people across Ireland say they will be cutting back on Christmas spending this year, as rising living costs continue to strain household budgets.
A new nationwide survey by KPMG reveals that 77% of consumers expect Christmas shopping to be “significantly more expensive” in 2025, while two in five shoppers plan to spend less than they did last year. The findings highlight the ongoing financial challenges facing households two years into a persistent cost-of-living crisis.
According to the KPMG Next Gen Retail survey, 54% of respondents say energy bills, rising supermarket prices and broader inflation will push them to reduce festive spending. More than half — 55% — plan to cut back on dining out and entertainment, while 56% expect to give smaller gifts due to the financial pressure.
The survey also shows that 60% of people find higher prices have made shopping more stressful. Almost one in five consumers (19%) say they will need to rely on credit to cover Christmas costs. The challenge is even greater for younger adults, with 32% of those aged 18 to 24 saying they will fund their Christmas through credit, which KPMG says highlights ongoing affordability issues.
KPMG’s Head of Consumer, Retail and Manufacturing, David O’Kelly, said this year’s festive season is likely to be defined by tighter budgets and a greater focus on value, noting that “winning Christmas will be about hitting the sweet spot on pricing that understands the pressure on disposable income but also gets it right on margin, range, stock and technology.”
Despite the financial strain, O’Kelly struck a cautiously positive note, adding that “retailers should remain cautiously optimistic.” He pointed to recent CSO data showing that consumer spending on clothing, electrical goods and in department stores increased in September 2025, while the monthly volume of retail sales (excluding motor sales) rose by 0.6%.
The survey also highlights the resilience of in-store grocery shopping. Despite the strong growth of online retail, 83% of adults still prefer to buy groceries in person.
Overall, KPMG says the findings indicate a Christmas season shaped by careful budgeting, value-driven choices, and continued uncertainty for retailers navigating a challenging economic landscape.
